SEC pivot sparks US digital finance shakeup

On July 31, U.S. Securities and Exchange Commission (SEC) Chairman Paul Atkins delivered a landmark 30-minute address outlining a sweeping initiative to modernize cryptocurrency oversight in the United States. While market prices remained unchanged immediately after the announcement, many in the crypto industry hailed the speech as the most optimistic signal for digital assets in a decade.

Introducing ‘Project Crypto’

Speaking at the America First Policy Institute, Atkins laid out the foundation for “Project Crypto,” an SEC-driven roadmap aimed at reestablishing the U.S. as a leader in digital finance. The speech, titled American Leadership in the Digital Finance Revolution, set the tone for a new chapter in U.S. crypto regulation.

Atkins detailed several key objectives for Project Crypto:

• Establishing a legal environment that fosters innovation and encourages startups to stay within the U.S.
• Supporting the transition to tokenized markets by moving traditional assets on-chain.
• Removing barriers that have prevented U.S. citizens from participating in airdrops, ICOs, and similar offerings.
• Creating SEC-regulated platforms—coined “super-apps”—to bridge traditional securities and digital assets.
• Offering regulatory flexibility for innovative companies that don’t yet fit into existing legal frameworks.

Industry professionals widely welcomed these proposals, with many praising Atkins for directly addressing long-standing issues that have stifled innovation under previous regulatory leadership.

A Shift in Strategy: Undoing the Past

The announcement also marked a clear break from the SEC’s former direction under Gary Gensler, whose tenure was characterized by aggressive enforcement actions against firms like Ripple and Coinbase. Critics argue that such lawsuits discouraged innovation and pushed major players out of the U.S.

One central tenet of Project Crypto is making the U.S. attractive again to crypto firms that had previously fled due to regulatory hostility. Atkins reaffirmed this commitment, saying, “The SEC will not stand idly by and watch innovation flourish overseas while our own markets stagnate.”

He directly addressed restrictions that had historically barred Americans from engaging in token distributions, noting that new rules would allow U.S. citizens to take part without fear of legal repercussions.

The initiative also seeks to undo what some have termed “Operation Chokepoint 2.0,” a perceived effort by regulators to sever ties between crypto companies and traditional banking institutions. Atkins promised a friendlier regulatory climate to encourage those firms to return.

Regulatory Roadmap and Industry Guidance

As part of the rollout, Atkins revealed that new SEC rules are being drafted to bring clarity to asset distribution, custody, and trading practices. While these are under development, the SEC may temporarily rely on interpretive guidance and exemptions to avoid stifling growth.

Importantly, Atkins proposed a framework that would allow even non-registered crypto firms to operate in the U.S.—under specific conditions. These include SEC reporting requirements, limited service offerings, and restrictions to prevent abuse.

The SEC also intends to categorize digital assets more clearly—distinguishing between digital collectibles, stablecoins, and other types of tokens—to help issuers and investors comply with relevant laws.

Additionally, Atkins emphasized the right to self-custody as a core American principle, stating that users should be free to choose how their assets are stored. Third-party custodians, however, will still need to meet SEC regulatory standards.

A Vision for Super-Apps and Tokenized Markets

Perhaps the most forward-looking idea presented was the introduction of “super-apps”—platforms where digital assets and traditional securities could be traded side-by-side under a unified system. According to Atkins, existing laws do not prohibit such platforms, and the SEC is actively working on guidance to make this vision a reality.

Atkins sees this convergence as a natural evolution: “Securities should be brought on-chain to reduce friction and remove unnecessary middlemen wherever possible.” To facilitate this transformation, some existing securities regulations may need to be rewritten.

Industry Reactions and Market Response

Despite the groundbreaking nature of Atkins’ address, crypto markets continued their downward trajectory the following day. Analysts attributed this to broader macroeconomic factors, including persistent Federal Reserve interest rates and elevated tariffs imposed under President Trump.

Nevertheless, Atkins’ proposals have sparked significant enthusiasm within the digital asset community. Many believe that once Project Crypto moves from speech to implementation, it could trigger a new wave of institutional and entrepreneurial participation in the U.S. crypto space.

SEC Chairman Paul Atkins has signaled a dramatic shift in U.S. crypto regulation through “Project Crypto”—a strategy focused on clarity, inclusion, and innovation. While market movements remain muted, the long-term implications for American digital finance could be profound.